A year ago, we made a number of predictions for the Service Provider Router market. As we move full steam ahead into a new year, we take a look back at those 2021 predictions, and how we think they apply to the SP Router market in 2022.
The Market Returns to Normalcy
In some ways, SP Router market conditions returned to pre-pandemic states in 2021, but in other ways, they did not.
From a quantitative perspective, the Service Provider Router market rebounded nicely in 2021 to pre-pandemic levels. Our preliminary estimates show that market revenues increased at a mid-single-digit rate to a record level. As we had predicted, Telecom and Cloud SPs increased spending in 2021 to boost IP network capacity and reset operational metrics to better align with the new traffic levels and patterns brought on by the COVID-19 pandemic.
However, supply chain disruptions and resource constraints continued to negatively affect product delivery and deployments throughout the year. While it is difficult to quantify the impact of these problems, consistent feedback from vendors, SPs, and distribution channels lead us to conclude that SP Router market revenue was depressed in 2021.
The good news for 2022 is that we expect underlying demand trends to continue driving growth of the SP Router market. The bad news is that we expect supply chain disruptions and resource constraints to persist throughout 2022. While we do not know when these disruptions will diminish—in 2022 or 2023—we predict that the return to normalcy will not be without problems. The volatile order growth and expanding backlogs that created so many challenges over the past two years will eventually subside. However, as order growth rates decelerate and backlogs shrink when supply and resource constraints improve, the challenges of balancing supply and demand will create new headaches for many companies.
400 Gbps Routers Become Meaningful
Market demand for routers that support 400 Gbps technologies steadily gained momentum throughout 2021 and became an industry focal point by the end of the year. Our preliminary estimate for 400 Gbps router port shipments shows an increase of more than ten times from 2020 to 2021–an excellent start for the early-adopter phase of emerging technology.
2022 is shaping up to follow on the initial success of 400 Gbps capable routers. For this year, we predict rapid demand growth for 400 Gbps routers that will firmly establish network capacity transformations over the next five years.
IP Mobile Backhaul Upgrades Accelerate
Our prediction of IP mobile backhaul market acceleration in 2021 proved to be correct for all major geographies except China. Our preliminary estimates for IP mobile backhaul revenue for markets excluding China ticked up at a double-digit rate in 2021. The China market experienced a slight decline in 2021, but still represented more than a third of the global market.
For 2022, we predict continued growth for IP mobile backhaul upgrades outside of China. 5G RAN deployments are the basis for most of the growth and the longer-term prospects for 5G are quite positive.
Disaggregated Routers Become a Real Thing
The market for disaggregated routers grew significantly in 2021, and our initial estimates point to a triple-digit revenue growth rate for the full year. Granted, the revenue growth was off of a small base, but another positive sign was that throughout 2021, the ecosystem for disaggregated routers continued to expand across hardware, software, and integration elements.
The disaggregated router market proved to be real in 2021, but it remains to be seen whether the market can become significant. We see many positive signs of opportunities such as a growing ecosystem and increasing trial activities. However, we predict that in 2022, the portions of the disaggregated router market will increasingly encounter the challenges that many emerging technologies face—ongoing interruptions from the COVID-19 pandemic, competitive responses from incumbent players, and resistance to change large and established infrastructures.
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Before looking at 2022, let’s look back one year and see how we did in 2021 compared to what we were thinking in 2020. Just a reminder when looking at 2021, we only have three quarters of actual results and the fourth quarter is still an estimate. The current projected 2021 revenues for the Mobile Core Network (MCN) market are predicted to come in 13% below what we thought at the end of 2020. However, 2021 is expected to have a growth rate of 6% Y/Y. For 2022, we project a growth rate of 8% Y/Y.
So what happened? The 2021 4G MCN market came in 13% below expectations, apparently, due to Communication Service Providers (CSPs) having enough installed capacity to carry them through the pandemic, or the pandemic slow down the installation of more capacity. We now project the 4G MCN growth rate of -8% Y/Y for 2021 and flat Y/Y for 2022.
The 2021 5G MCN market came in 10% below our expectations from 2020, and this is due to the lack of more aggressive 5G Standalone (SA) network buildout than anticipated. We count 13 CSPs that commercially deployed 5G SA networks for enhanced Mobile Broadband (eMBB) in 2021, and they were nowhere close to the aggressiveness in breadth and depth of the buildouts that we saw by the Chines SPs in 2020, or for that matter in 2021. We thought all three CSPs in Korea would have launched by now, but so far only KT has launched. And we expected AT&T and Verizon in the US, and the CSPs in Switzerland to have launched 5G SA in 2021. In spite of these disappointments, the projected growth rate for 2021 is 61% Y/Y for 2021 and lowering to 18% Y/Y for 2022 due to the expected decline in growth rate by the Chinese CSPs.
We were closer to the IMS Core forecast for 2021, only being 3% below the current forecast for 2021. The growth rate for 2021 is now projected to be 5% Y/Y for 2021 and 8% for 2022 as more CSPs upgrade their voice networks to VoLTE or VoNR in preparation for their 5G SA launches.
The outlook is still positive for the overall MCN market growth rate with a 6% Y/Y for 2021 and 8% for 2022 being driven by the expansion of existing 5G SA networks and new 5G SA networks poised to launch for the 5G MCN and IMS Core markets.
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Broadband Focus Will be Squarely on Fiber and Increased Competition in 2022
The emphasis on and investments in advanced broadband access networks around the world over the last two years shows no signs of abating in 2022. Despite the headwinds of component and labor shortages, inflation, and logistics snafus, broadband network buildouts and upgrades, coupled with net subscriber additions are projected to result in over $15.5 B in equipment spending in 2021. With the sustained influx of new capital from both governments and private equity, 2022 spending should be equally strong.
The 2021 results were somewhat of a surprise to some, as there were expectations that students returning to in-person instruction and workers partially or fully returning to their offices would result in a reduction in home broadband subscriptions that had been added in 2020 at the height of the pandemic. But, net subscriber additions didn’t decline and in fact accelerated throughout 2021. For those of us who have monitored the broadband market for some time, this wasn’t a surprise, as broadband remains one of the stickiest services a provider can offer. Though there is churn, as there is with many services, once broadband is in the home, it more than likely will remain and be integrated into the household budget.
As a result, investments in broadband infrastructure—specifically fiber networks—have skyrocketed, with private equity fueling a growing number of buildouts in North America and Europe. Investing in network infrastructure—which hasn’t been cool since the late 90’s—is suddenly all the rage. As such, the valuations of fiber networks have increased significantly, driven by increased demand for residential broadband, ongoing 5G network buildouts, and an expectation that fiber networks still need hundreds of billions in new investments to keep pace with expected bandwidth demand.
Of course, national Government plans including the RDOF (Rural Digital Opportunity Fund) and Build Back Better programs, as well as tax incentives in the UK and other European countries, intend to cover some of that necessary investment. But that hasn’t pushed private investment to the sidelines. All of this means that 2022—even 2023—should be very strong years for broadband equipment manufacturers.
Changes in the Competitive Landscape Will Force Cable Operators to Move Faster
Before discussing the expected impacts on specific broadband technologies and products, it’s critical to look at how sustained investments in fiber and even fixed wireless networks will dramatically alter the competitive landscape in broadband. The biggest change to the overall market that these investments provide is not only availability where it didn’t exist before, especially in the case of rural and underserved markets, but also the introduction of choice where that didn’t really exist before. In North America and a number of Western European countries, realistic consumer choice among multiple broadband service providers has only recently begun to increase. In most areas, the choice has been between cable and DSL, with cable operators able to offer speeds that satisfy increased subscriber requirements, while DSL languishes at sub-50 Mbps speeds. The net result—especially in the US market—was broadband market dominance to the tune of over 65%.
That dominance has certainly benefited cable operators and kept their subscriber base and margins growing in the face of sustained pay-TV service cancellations. But in some cases, it has also not prepared them adequately for the significant changes that are headed their way in the form of new fiber-based competitors. Some cable operator executives have been downright dismissive of the looming threats—especially those coming from fixed wireless.
Tom Rutledge, CEO of Charter Communications, said back in September 2021 that, “We actually look forward to a higher churn environment…We do well with prospects looking to change their services.” In a world where Charter was competing only with DSL providers, the company clearly did well and has continued to excel in pulling away dissatisfied DSL subscribers who required more speed but couldn’t get it, especially during the pandemic.
But going up against fiber providers with consistent gigabit (and even multi-gigabit speeds) is an entirely different story altogether, one in which the MSOs could find themselves in a similar position to previous DSL providers. We have already seen a slowdown in net new broadband subscribers among some of the largest US cable operators. That slowdown has been attributed to (among other things) an expected decline in subscriber churn from DSL providers largely because there are so few left to poach.
But with AT&T, Verizon, Frontier, Ting, Sonic, and other providers posting increasing fiber subscriber additions, at least some of the subscriber slowdown at Charter and others has to be attributed to these subscriber gains being made at the cable operators’ expense. So much for being successful in high-churn environments.
In this new battle, cable operators are also saddled with the consumer perception that they are not providing value even if they are providing the fastest speeds available in a particular area. Part of this perception is due to the longstanding residue of consumers consistently ranking their cable providers at the bottom of the list for value and customer service. It’s one reason why people have dropped (and continue to drop) their pay-TV subscriptions so quickly. Again, so much for being successful in high-churn environments.
So, what does this mean for cable operators, from the perspective of infrastructure investments and technology rollouts? There are a couple of implications:
There will be a growing percentage of tier 1 cable operators who increase their investments in fiber infrastructure. We have already seen a decent number of tier 2 and tier 3 operators in North America opt for the complete replacement of their HFC networks with full fiber. While we certainly don’t expect to see a wholesale cutover among any tier 1 cable operators, we believe this year will see an increase in fiber overbuilding in some of the more competitive markets in order to maintain the perception of parity with fiber competitors.
Tier 1 operators will push very hard to accelerate the DOCSIS 4.0 product availability timeline. We are already seeing hints of this with system vendors pursuing silicon partnerships outside of Broadcom in order to expedite the availability of products, particularly remote-MACPHY devices. We are also already seeing announcements of successful lab trials using both full-duplex DOCSIS and extended-spectrum DOCSIS to deliver multi-gigabit speeds.
In the short term, we fully expect cable operators to continue their current mid- and high-split upgrade projects to increase upstream bandwidth for their DOCSIS 3.1 networks. This will result in sustained DOCSIS channel license purchases through at least the first half of the year and perhaps throughout the year, with a growing percentage of those licenses being supported on vCCAP platforms in support of R-PHY deployments, as well as on R-MACPHY devices.
Speaking of R-MACPHY, the availability of products that adhere to the Flexible MAC Architecture (FMA) specification will accelerate this year, with MAC Manager products moving from the lab to field trials later this year. The availability of these products, while not an absolute requirement for DOCSIS 4.0, are important stepping stones in continuing the further disaggregation of the I-CCAP and vCCAP platforms, which is viewed as an important precursor for many cable operators as they begin their journey to DOCSIS 4.0, either in the form of Extended Spectrum DOCSIS or Full-Duplex DOCSIS. Additionally, some MSOs view FMA as a way to open the door to more fiber deployments, as remote OLTs and ONTs can be managed similarly to cable modems.
Within the home, cable operators are going to move quickly to expand the availability of high-end residential gateways that include both Wi-Fi 6 and, in the US Wi-Fi 6e. Comcast recently announced a new Wi-Fi 6e gateway manufactured by Technicolor that will be reserved initially for those customers taking its gigabit service offering. Comcast’s positioning with the gateway is that it offers the fastest speeds to and within the home. Fiber doesn’t make any difference if the W-iFi gateway in the home is anything less than Wi-Fi 6 or Wi-Fi 6e.
Fiber Expansion Will Accelerate
The switch from copper to fiber among the world’s largest telcos really became clear in 2020 and 2021. That trend will accelerate in 2022, in particular, because of the investments made this year in new optical line terminal (OLT) ports. Operators throughout North America, EMEA, and CALA switched more of their capex towards expanding their fiber networks than sustaining their DSL networks. This was clear at Telmex, BT OpenReach, and others. Major projects at Deutsche Telekom, Orange, Proximus, and elsewhere will drive not only more fiber expansion but 10 Gbps deployments using XGS-PON.
Fiber access networks have reached a major tipping point, driven by the simultaneous catalysts of the shift to next-generation fiber technology and the shift to openness, disaggregation, and automation. The world’s largest broadband providers are quickly realizing that the need for increased throughput is matched by the need for a highly-scalable network that can respond quickly to the changing requirements of the service provider, their subscribers, and their vendor and application partners. The need to provision and deliver new services in a matter of hours, as opposed to weeks or months, holds just as much priority as the ability to deliver up to 10 Gbps of PON capacity. Although service providers might have completely different business drivers for the move to open, programmable networks, there is no question that the combination of data center architectural principles and 10G PON technology is fueling a forthcoming wave of next-generation fiber networks upgrades.
The service providers that adopt the combination of 10 Gbps PON and openness will be best prepared to accomplish three major goals:
Deliver the advanced, 10 Gbps capacity, and multi-gigabit services subscribers will expect and require using a cloud-native infrastructure that treats bandwidth and the delivered applications as workflows.
Anticipate and whether rapid increases in traffic demand with a highly-targeted and elastic infrastructure that can be activated without a forklift upgrade.
Develop an access network infrastructure that can process multiple workloads beyond broadband access, including hosted services that can be offered on a wholesale basis, as well as fixed-mobile convergence applications.
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Huawei Leads the $100 B Telecom Equipment Market
We just wrapped up the 3Q21 reporting period for all the Telecommunications Infrastructure programs covered at Dell’Oro Group, including: Broadband Access, Microwave & Optical Transport, Mobile Core & Radio Access Network (RAN), SP Router & Switch. The data contained in these reports suggest that the positive trends that characterized the broader telecom equipment market in the first half of 2021 extended into the third quarter, propelling the overall telecom equipment market to a sixth consecutive quarter of year-over-year (Y/Y) growth.
Preliminary estimates suggest the overall telecom equipment market advanced 6% Y/Y in the quarter and 9% Y/Y year-to-date (YTD). The growth in the quarter was underpinned by healthy demand for both wireless and wireline equipment.
While the majority of the suppliers were able to navigate the supply chain situation fairly well in the first half, supply chain disruptions had a greater impact in the third quarter, though clearly this was not enough to derail the positive momentum that has characterized the market over the past six quarters.
The analysis contained in these reports suggests the collective global share of the leading suppliers remained relatively stable between 2020 and 1Q21-3Q21, with the top seven vendors comprising around ~80% of the total market.
Ongoing efforts by the US government to curb the rise of Huawei is starting to show in the numbers, especially outside of China. At the same time, Huawei continued to dominate the global market, still nearly as large as Ericsson and Nokia combined.
Overall, we believe ZTE and Samsung are trending upward while Huawei is losing some ground YTD relative to 2020.
Additional key takeaways from the 3Q21 reporting period include:
Positive market sentiment in the third quarter was driven by strong growth in RAN and Broadband Access, which was more than enough to offset weaker trends in Optical Transport.
RAN and Broadband Access are also the strongest growth vehicles for the YTD period, fueled by surging demand for 5G, PON, and FWA CPEs.
With the pandemic resurging and the visibility surrounding the supply chain weakening, the Dell’Oro analyst team is expecting near-term growth to decelerate – the overall telecom equipment market is now projected to advance 2% in 2022, down from 8% in 2021.
The combination of Industry 4.0/Smart Factories and 5G represents a promising growth opportunity and value creator for suppliers and operators looking beyond the tepid growth typically associated with the consumer 5G MBB market. Fueled by the vision that 5G has a growing role to play in the Factory of the Future, 5G manufacturing expectations are rising. And even though manufacturing comprises a significant share of the current ~10 K 5G B2B projects globally, commercial 5G RAN investments targeting the manufacturing vertical are still tracking behind schedule. In this blog, we will review the cellular manufacturing opportunity, the benefits with private 5G, and potential 5G use cases. We will also review progress with some of the early 5G manufacturing adopters.
The Manufacturing Opportunity
One of the more compelling aspects of the manufacturing vertical is that this market is quite large. According to the World Bank, manufacturing accounted for 16% of global GDP in 2020. A fairly concentrated industry, from a regional perspective, China, the US, and Japan generate nearly half of global manufacturing output.
In addition, the manufacturing sector is transforming rapidly, as new technologies are introduced to manage changing consumer demands and external risks, including supply chain disruptions and skillset shortages.
While premium cellular connectivity will not make sense in all manufacturing locations, Nokia estimates approximately 10 M industrial & manufacturing sites globally that could potentially benefit from using mobile technologies.
Huawei is even more optimistic. This vendor has endorsed a report estimating that 5G could unlock $740 B of value in manufacturing by 2030, adding nearly one percent to global GDP.
Ericsson is also excited about the potential productivity and efficiency gains with 5G. The company’s “5G for business” report predicts that manufacturing will make up a fourth of the incremental $700 B opportunity for communications service providers (CSPs) by 2030.
According to ZTE’s most recent analyst update, the vendor sees the enterprise opportunity as an important growth vehicle that can offset the more tepid growth typically associated with the CSPs.
Not surprisingly, operators are also enthusiastic about the upside with the manufacturing vertical. China Unicom is expecting that manufacturing will comprise around 28% of the economic value of the 5G verticals by 2035, underpinned by healthy growth in a wide range of manufacturing verticals.
More importantly, 86% of manufacturing executives say they believe that smart initiatives, such as improved connectivity using private mobile technologies, will play an important role over the next five years (Deloitte).
Why Use 5G in Manufacturing?
Given that WLAN is the de-facto IoT technology and that the manufacturing vertical has comprised around 10– 15% of the enterprise Wi-Fi market over the past five years (Dell’Oro Group, WLAN), why use 5G instead of Wi-Fi? After all, Wi-Fi is well equipped to address a wide range of non-industrial use cases. Enterprises are familiar with the technology, the PHY is almost the same, and it can typically be deployed in less time than cellular-based systems. WiFi6, which uses the 802.11 ax standard, offers multiple enhancements relative to its predecessor, including improved performance in high-density scenarios.
Still, even as the gap between Wi-Fi6 and 5G NR is shrinking on paper and Wi-Fi is projected to play a dominant role in manufacturing going forward, early cellular adopters see LTE—and especially 5G—as an important complement in industrial settings with demanding consistency, reliability, positioning, mobility, security, and UL performance requirements.
It is important to note, however, that both the unlicensed and licensed spectrum have a role to play. And while the physical layers for both 5G and Wi-Fi don’t differ much, the scheduler process in the MAC layers does differ. Findings from two 5G smart factories, one in China and another in Europe, suggest that Wi-Fi will do just fine with 10-20 IoT devices and minimal handover requirements. If the site needs to support more than 20–30 devices transferring large amounts of data, though, wide-bandwidth (WB) 5G NR is preferable to Wi-Fi.
Perhaps more importantly, 5G is typically not operating in the shared spectrum. It was interference and signal degradation with the Wi-Fi network that triggered Whirlpool to explore licensed 5G, instead of WiFi, to support its driverless vehicles inside its Ohio factory.
The roles of Wi-Fi and cellular will likely evolve over time. As manufacturers move beyond this initial connectivity phase with PCB inspections, automated material handling, autonomous-guided vehicle (AGV) dispatching, and 5G robot controls, the 5G business case will likely improve further as manufacturers rely more on AR and time-critical communications play a greater role.
Manufacturing Use Cases
5G manufacturing is still in its early days—and the majority of enterprises are still in the exploratory phase, learning how consistent 5G can provide incremental value over existing connectivity technologies. Below we will list some of the use cases we believe could benefit from 5G, both short-term and long-term.
Automated Guided Vehicles (AGVs) & Autonomous Mobile Robots (AMRs)
Based on preliminary feedback from multiple manufacturing plants, 5G-connected AGVs will likely be one of the leading smart manufacturing use cases initially. The concept of using AGVs— also known as portable robots, self-guided vehicles, or autonomous vehicles—to transport and distribute material across the factory floor, enable just-in-time (JIT) delivery of raw material, and improve efficiency across many different industrial settings is not new. The AGV market is well established, worth > $2 B, according to external sources.
Up until now, the AGVs have relied predominantly on Wi-Fi as the connectivity technology. While Wi-Fi works very well in many industrial settings, it is not always ideal for AGVs, especially if they are moving across large areas and are being used to capture information.
According to Hitachi, the optimization gained by investing in these assets can quickly be eroded if there are Wi-Fi shadows around the facilities.
Both LTE and 5G can provide the consistency, reliability, coverage, capacity, and mobility required for AGVs to navigate the transition from defined path transportation to autonomous flexible routing and, eventually, centrally guided routing.
Ericsson envisions that 5G can also help to reduce cost, by moving the compute from the AGV to a local edge location.
Most importantly, this is more than a PowerPoint vision at this point, as 5G-connected AGVs are already helping manufacturing plants free up forklift operators and improve efficiency. ZTE’s 5G BTS smart factory in Binjiang Park (part of the Green Expo Park, located in the southern city of Nanjing) utilizes more than 40 5G cloud-based AGVs to deliver materials, including chipsets and PCBs, across the plant for various production steps. Similarly, Ericsson is using 5G-connected AGVs at its smart factories in Tallinn and Texas. And Nokia is relying on 4.9 G-connected AGVs at its facility in Oulu, Finland.
With the AGV market expected to grow nearly eight-fold by 2030 (Ericsson), the 4G/5G AGV opportunity is real, though it is worth pointing out that when we reviewed America for Motion’s cellular AGV readiness, we learned that only the Easybot offered Wi-Fi/4G. All other remaining vehicles—including the fork, clamp, unit load, lift table, tugger, turret truck, and specialty AGV—only support Wi-Fi.
Digital Twin
Digital Twin technology creates a digital replica of a physical object or system. By combining the physical form/digital representation and the dynamics coordinated in real-time based on sensing and monitoring of actual performance, digital twins can help to continuously test, assure, optimize, monitor, and automate prototypes, commercial products, networks, and processes.
Creating virtual models out of physical objects and processes is not a new concept. And while existing connectivity technologies will go a long way, the improved availability, capacity, coverage, latency, mobility, and reliability with 5G can play an important role in capturing data from a large number of sensors across the factory in near-real-time.
According to a recent Verizon survey, digital twin implementations will become a priority over the next year in the manufacturing sector.
ZTE’s 5G digital twin assembly line, at the smart manufacturing base in Binjiang Park, leverages sensor data and physical models to make forecasts for the entire lifecycle, ultimately improving efficiency
Recent supply shortages are also spurring the need for supply chain digital twins to help manufacturers forecast bottlenecks and respond to disruptions and fluctuations throughout the supply chain.
Quality Inspections
Inspections are critical steps in the manufacturing process, to ensure the expected quality and reliability but they also come at a cost. Manufacturers are constantly trying to find the right balance between cost and quality. Even with technology advancements, manual visual inspections (MVIs) still comprise a significant share of the overall inspection process.
LTE/5G connected cameras with machine learning and MEC computing can be used to reduce reliance on manual inspections and improve overall quality. While this process can also be implemented with Ethernet, wireless systems are generally more flexible.
The combination of 5G high-definition cameras and machine learning has helped ZTE reduce its reliance on manual labor for PCB inspections at its Binjiang Park smart factory, improving PCB quality by about 97%.
Augmented Reality (AR)/Virtual Reality (VR)
AR and VR have tremendous potential for improving productivity and efficiency across multiple manufacturing segments and production steps. These technologies can help workers display overlays and enable them to tap into remote skillsets. The ability to use voice commands with wearables and locate drawings and part numbers without having to pause and use a computer can be a game-changer. Boeing, for example, was able to cut its wire harness assembly production time by 25% and lower error rates to nearly zero.
With skillset shortages accounting for nearly 60% of unfilled manufacturing positions (Ericsson), the remote opportunity is significant. Ericsson estimates that AR has helped to cut travel costs by 50% and reduce downtime at its 5G Factory in Texas.
5G Manufacturing Market Status
Preliminary estimates suggest that the 5G NR manufacturing vertical still accounts for about 0% of the overall 5G RAN market. However, activity is increasing as more enterprises are exploring how 5G can help them modernize the factory, reduce costs, shorten production cycles, improve asset utilization, and boost safety. The manufacturing vertical currently accounts for a double-digit share of Huawei’s, Nokia’s, and Ericsson’s ongoing private wireless projects. Ericsson recently reported, in fact, that the manufacturing segment is showing the strongest momentum within all its private wireless engagements.
In addition, RAN suppliers are also putting the technology to use internally. Ericsson and Nokia, both of which are powering some of their own factories with 5G, have also been selected by the World Economic Forum as an Advanced 4th Industrial Revolution (4IR) Lighthouse. In Korea and the US, Samsung has already delivered a full end-to-end 5G network to its own factories.
Similarly, ZTE’s manufacturing base in Binjiang Park utilizes 5G connectivity to improve efficiency and costs with 5G-connected AGVs, cameras, digital twins, machine vision, and industrial robots. Full automation of all operations has saved millions of USD in manpower per year, implying that the initial investments can be recouped in just a few years.
In summary, 5G manufacturing is still in its early days. At the same time, more suppliers and enterprises are increasingly exploring how 5G can be used to deliver value beyond existing connectivity technologies across multiple manufacturing segments. The uptick in demand—in combination with progress on the supply side—with more end-to-end services and solutions becoming increasingly available, forms the basis for an upbeat long-term outlook for the future of 5G manufacturing.
Positive market sentiment in the third quarter was driven by strong growth in RAN and Broadband Access, which was more than enough to offset weaker trends in Optical Transport.
